Paytm Shares Jump 7% to Fresh 52-Week High After UPI MDR Announcement

Shares of One 97 Communications, the parent company of Paytm, climbed more than 7% on September 16, touching a fresh 52-week high after the government introduced a Merchant Discount Rate (MDR) on certain high-value UPI payments. 

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The stock rose as much as 7.2% during the session to ₹1,856.50. At that level, it had gained about 96% from its 52-week low of ₹947.10, recorded in March 2026. 

The sharp move came a day after the National Payments Corporation of India announced that MDR would apply to certain person-to-merchant UPI transactions from October 15. The new framework opens a commercial revenue stream around a portion of UPI payments while keeping smaller transactions and payments made by consumers free. 

MDR set at 0.4% for eligible UPI payments 

Under the new framework, merchants will pay an MDR of 0.4% on applicable UPI transactions above ₹2,000. 

For transactions of ₹75,000 or more, the fee will be capped at ₹300. 

Payments of ₹2,000 or less will continue to attract zero MDR. According to the government’s FAQ cited in the report, these smaller payments account for more than 95% of UPI’s person-to-merchant transaction volume. 

The framework also leaves person-to-person UPI transfers outside the MDR structure. 

Small merchants covered by the P2PM framework will remain exempt as well. This includes vendors receiving up to ₹1 lakh a month through UPI QR codes. 

UPI users will not pay the charge 

The MDR will be borne by merchants rather than consumers. 

NPCI has clarified that merchants cannot pass the charge on to customers. A person making an eligible payment through UPI will therefore continue to pay the listed transaction amount without a separate fee being added by the UPI application. 

That distinction is important because the change introduces a charge into a part of the UPI ecosystem without imposing a direct transaction cost on users. 

New framework brings UPI monetisation into focus 

The announcement has put payments companies such as Paytm in focus because qualifying merchant transactions will now carry a commercial charge. 

UPI has operated for nearly seven years without additional charges for users, while the government has maintained that the payment system will remain free for citizens and that person-to-person transactions will not attract fees. 

The Reserve Bank of India has backed the introduction of MDR on large-value UPI transactions, linking the change to the long-term sustainability of India’s digital payments ecosystem. 

For Paytm, the immediate market response was visible in Wednesday’s trading. The stock’s rise to ₹1,856.50 marked a new 52-week high and extended its recovery from the ₹947.10 low recorded six months earlier. 

With the MDR framework scheduled to take effect from October 15, attention now shifts to how the new charging structure plays out across eligible merchant UPI transactions.